Archive for the “Leadership” Category

Embracing a Crisis Creates Humility

January 21st, 2010

At the age of 47 I would like to think there will be no more crises coming my way.  Yet, I am realistic to know that as long as I am breathing, this world likes to deal in drama.

In my last position as chief human resource officer, we built a great company with a wonderful team of people, but executive behavior began to turn toxic and the winds of corporate culture changed from calm to stormy.
I was fired for raising warning flags about out of control executive behavior.  Seven months later the company filed for bankruptcy, apparently due to the greed and egos of a few individuals.  This bankruptcy has cost thousands of people and businesses millions upon millions of dollars.  The personal and financial costs to me were enormous as well.  It was simply a crisis of life.

If you are old enough you have likely dealt with some tough life issues. As imperfect human beings living in a volatile world we are bound to run into difficulty several times in both our personal and professional lives.  When these difficult times hit us head on there are several questions we ask ourselves, however two particular questions come to mind: 1) Why me? and 2) How do I get through this?

Why Me? Although this is a very good question, you are not going to like the answer.  Tough stuff happens to everyone. When you see someone walking down the hallway who appears to have their life together, walking confidently, dressing sharply and appearing on top of the world, you can rest assured if they have not dealt with life’s difficulties, they will.  But my money is on the fact that they have dealt, or are dealing with something in their life that has shaken the very foundation of their beliefs.

We are not alone when it comes to dealing with a crisis. It is a time to bring those close to you closer. It is also a time to discover who will stand by your side. Everyday, someone around you is likely trying to work through a difficult life or business issue.  Simply put, you are not alone.

How Do I Get Through This? This is actually a better question to ask. “How am I going to get through this crisis and become a better person as a result?” We can choose to run away from adversity in life or embrace the hard times in life.  Don’t get me wrong, I am not saying we should enjoy those difficult days, but rather accept that we are going through a rough time and make the best of it.  Otherwise, we will likely alienate all those people important to us: family, friends and coworkers.

The Results. I would much rather work with someone who has been tested by a crisis in life.  If they have tasted the scorn of the real world, and embraced and allowed the crisis to make them a better person, this individual will likely make a great coworker or leader. Those who have embraced and learned from adversity tend to develop genuine humility.  Humility is a wonderful quality that tells me someone is worthy to lead others.

Those who run from a crisis, or make the crisis worse by creating more issues and drama are not worthy to lead or serve in a position of responsibility.  People with excessive ego needs will likely run from a crisis and fail to learn the valuable lessons a crisis brings, hurting themselves and those around them.  I am not advocating accepting failure, but rather embracing what should be learned from adversity.

Great leaders experience success because of their humility and give credit to others rather than demanding the limelight or absolute loyalty.

What is a Crisis? The type of crisis you are enduring is not as important as how you deal with it.  Whether we are dealing with with abuse, trauma, death or disease, bankruptcy, financial setbacks, family disagreements or workplace distress, we should work to become better people on the other end of the ordeal.  This requires accepting crisis as a fact of life and learning through the eyes of humility. It is my hope you will become a better person for enduring your next trial in life and show how it can be accomplished with humility and grace.

* * * * * * *

“The best CEOs in our research display tremendous ambition for their company combined with the stoic will to do whatever it takes, no matter how brutal (within the bounds of the company’s core values), to make the company great. Yet at the same time they display a remarkable humility about themselves, ascribing much of their own success to luck, discipline and preparation rather than personal genius.”

– Jim Collins, Author of Good to Great

Graphic Credit: Oblation by Netzie Bebing in Grey Tones

Posted in Leadership / 1 Comment →

The Rumor Mill at Work

December 17th, 2009

rumor millIf you are a business leader working to create a great workplace built on trust and respect, the typical company grapevine and rumor mill can work against your best efforts.  The people who tend to run these unofficial underground communication systems may not always be healthy for your organization.  These seemingly untraceable messages can work against your great workplace strategy.  In other words, the water cooler can be a toxic meeting place.

Not everyone will join the great workplace movement with your leadership team, even though they are proven to be the most financially successful, innovative, creative and long-term successful organizations.  Not everyone wants to play nice.  And there are those who prefer to create turmoil and misery in the workplace.  Toxic employees and managers can feed the unofficial communication pipeline with questionable information merely to stir up controversy.

According to grapevine experts, the majority of water cooler talk doesn’t really happen at the water cooler any more.  Employee chatter, rumors, gossip and grapevine banter transpires at company kitchens and breakrooms across America.  Although a certain amount of communication through the grapevine is to be expected – and can be utilized as a positive tool by leadership – the vine can cross the line and hurt innocent people inside or outside your organization.

When leaders work to create a great work environment, it is a good idea to squelch rumors fairly quickly to prevent people from getting hurt.  Observing the grapevine participants allows leaders to determine who may or may not be a good cultural fit.

In companies where there is little communication coming down from the top, grapevine traffic will increase to counterbalance the information void.  The problem occurs when the information being distributed through the vine is purely speculative, untrue or aimed at individuals that could be devastating.  Leaders need to be careful not to be held hostage by the gatekeepers, gossips, rumormongers and snitches that can overrun a company if they are not properly dealt with, according to Paul Falcone, a human resource executive and best-selling author of several human resource books.  He defines the different types of grapevine participants, as follows:

  • Gossips: These folks typically initiate unfounded rumors.  They obtain power from having the “scoop.”
  • Rumormongers: Perpetuate rumors even if they are completely untrue, lack a foundation in truth or could damage the reputation of a coworker.
  • Snitches: This role is fairly self-explanatory.  Snitches derive their power from sharing juicy information that is usually hurtful to others.  Playing the role of a tattletale is just plain wrong.

When someone volunteers a juicy piece of information while you make your morning or afternoon run to the break room, do you choose to participate, even if the information could be hurtful or degrading to a fellow employee? It is best to live by higher standards and refuse to listen to or perpetuate company gossip.  Creating a great workplace requires a certain amount of discipline.

Image Credit: A.V. Club

Posted in Company Culture, Leadership / 1 Comment →

Respect Your Employees for Customer Service Excellence

September 28th, 2009

QuikTrip, a convenience store enterprise headquartered in Tulsa, Okla., has demonstrated how to succeed through Positive People Practices. One of those is the practice of showing respect to their employees 24/7.QuikTrip

You will find no bigger QuikTrip fan than me. I use their gasoline almost exclusively for my cars, and our family frequents their stores because they are clean and well-stocked with a great selection of convenient items.  Look at my bank statement and you will see the evidence of my QuikTrip addiction.  I am hooked on their Diet Coke with Vanilla.  I love their French vanilla cappuccino. When my wife is not around I will buy a hot dog.  In fact, every time I leave town I stop by QuikTrip and buy a drink before I leave. But the biggest reason I am a QuikTrip fan is because their employees are friendly. They show respect to their customers.

Every time you walk into one of their stores an employee will welcome and acknowledge you.  At a time in America when many companies have forgotten about customer service, friendliness and showing respect, QuikTrip stands way above the pack in the convenience store industry, or most any industry. If you don’t believe me, visit a city that does not have a QuikTrip presence.  In fact, the City of Tulsa should advertise QuikTrip as a selling point for living here.

Showing respect to customers has to be one of their key ingredients to success. More importantly, I will venture to guess their employees are first shown tremendous respect by their leaders.  Typically, employees model the behavior they see in their leaders.  The dictionary defines respect as giving particular attention to something or someone worthy of high regard.  I suspect their employees treat me well when I walk through those swinging glass doors, because they are first treated in high regard by the company.

This is amazing when you consider the culture we live in today. Cable television provides an onslaught of news programs where people are arguing and yelling at each other. There is an endless lineup of reality shows where cut-throat antics are utilized to gain a competitive advantage.  Drivers on American roadways are even becoming more aggressive, less forgiving and impatient.  The workplace is becoming more dangerous and disrespectful where employees are seen as expendable assets rather than people with feelings and families.

So I salute QuikTrip for creating an atmosphere of respect for employees, which ultimately trickles down the line to their loyal and happy customers, like myself.  Before the customer enjoys respect the employee must first benefit from a culture of respect.

Note: QuikTrip is currently rated by Fortune Magazine as the 27th Best Company to Work For in America.

Posted in Company Culture, Leadership / 1 Comment →

The culture of an organization is more about the leadership than about the industry

June 18th, 2009

How does an employee prevent leaving one toxic work environment only to take a position inside another toxic culture?  There was an interesting column recently in J.T. & Dale’s Talk Jobs column that addressed this very issue.  The question was asked how to avoid taking a job in a toxic work environment.

The wise words of wisdom from the authors was this: “Rather than look for a different industry, your best hope is to find an organization whose culture is aligned with yours.”

They further stated, “the best way to do that is to interview an employer as much as he or she interviews you.”

There are good leaders out there who want to create rewarding work environments and that don’t send employees home at night confused, deflated, depressed and anxious.  Just as good employers perform their due diligence on new employees, those in the job market need to decide what is important to them.  What are your work environment non-negotiables?  Develop some questions around those requirements to ask your potential boss.

Below are a few questions to consider asking at your next interview?

  • Are employees allowed to take risks and develop innovative solutions on the job? If yes, what is a recent example of employee-led risk taking or innovation?
  • What happens to a good employee who makes an honest mistake?
  • When there are openings in the company does the leadership look to fill those spots from the inside first?  Who are some people who have recently been promoted?
  • Is this company’s leadership flexible with the work/life demands of employees?  What are some examples of current flexible work arrangements?
  • Do company leaders provide telecommuting options to get work done?
  • Does this company prevent workplace bullying?

Posted in Company Culture, Leadership / No Comments →

Video Series Sponsored by The People Group Premiers on YouTube – Sid Citrus: A**hole Boss

June 15th, 2009

ATTENTION A**HOLE BOSSES!
Sid Citrus launches campaign to be crowned your King.

Orange Rebel Productions today announced the launch of a new comedy web series, Sid Citrus: A**hole Boss, in partnership with inaugural corporate sponsor, The People Group. “Sid’s goal in life is to be universally acclaimed by his peers as the King of all corporate assholes. Sid Citrus already stands head and shoulders above every other jerk boss out there,” laughs writer-director Fred Emmer. “Or rather I should say, he floats.” Sid Citrus is an orange. A floating, philandering orange to be exact, who wears a tie, including Saturdays. And he’s not very nice.

“I laughed my head off when Fred gave me the script. I immediately knew we had to get this made,” recalls workplace consultant Kevin Kennemer, principal of The People Group. “That Sid Citrus, what an absolutely amazing jerk!” The first three webisodes tell story of how rookie cube dweller Brett comes to realize that his floating orange boss is a bully and an a**hole and that standing up to him can lead to lethal consequences, literally. “Of course Sid as a character and the story events are beyond farcical,” says Emmer. “But we actually are trying to say something.”

“The issues are real and I deal with them every day,” adds Kennemer, whose consulting practice specializes in helping corporations put people friendly practices in place. “Incivility in the workplace creates huge costs no company can afford to ignore. The effects of psychological mistreatment on
the workforce is brutal and allowing it to go on is immoral. I think Sid Citrus makes the point with humor.”

Fred explains Sid Citrus’s origin. “A friend of mine had recommended Kevin’s blog to me and after reading a few posts I couldn’t believe how candid he was in condemning a**hole behavior in the workplace,” said Emmer. “It hit me viscerally and I was thinking about his post as I strolled to the fruit bowl in the break room. Someone had left a Sharpe marker by the bowl. Two minutes later, Sid Citrus was born,” stated the writer-director from Tulsa, Oklahoma.

One school of thought is that every organization should have one a**hole. That might be okay if the asshole is kept around so their behavior can be used as a bad example, and if they are not too high in the organization. Kind of like an object lesson in a**holeology. But most organizations aren’t
that sophisticated. Inevitably corporate a**holes wind up breeding like rabbits, eventually poisoning the entire organization.

“I’ve already heard it from my wife, don’t be a Sid,” says Emmer. “He’s not even real and he’s already helping me put a check on my own behavior. I hope we can spread this around,” states Emmer. “Don’t be a Sid.” Sid Citrus: A**hole Boss can be viewed at: www.youtube.com/sidcitrus and at www.SidCitrus.Com.

About Orange Rebel Productions
Orange Rebel Productions is a Tulsa based media production company specializing in viral
video production for the web.

About The People Group
The People Group is a Tulsa based consulting firm committed to improving employee lives,
business performance and society through positive people practices consulting. The company
was founded on the premise that positive people practices result in better organizations.
The People Group proved that a leadership team that adopts, models and promotes positive
people practices benefits business, for people, for customers and society.

Kevin Kennemer, The People Group founding partner, provides a short article on A Word About the Term A**hole.

Media Contacts

Fred Emmer | Writer-Producer | Orange Rebel Productions | 918.519.6206 | sidcitrus@gmail.com

Kevin Kennemer | Founder & Partner | The People Group | 1.888.797.9992 | kevin@thepeoplegroupllc.com

Posted in Business Ethics, Company Culture, Leadership, Workplace Bullying / 2 Comments →

Freedom to Surf Increases Employee Productivity

April 7th, 2009

Supervisors who freak-out when employees use the Internet at work for non-work reasons should breathe a little easier.  A new study published by the University of Melbourne, Australia, shows employees who engage in WILB (workplace internet leisure browsing) are 9% more productive than their non-surfing counterparts.

The research study’s media release identifies that employees need time to periodically zone-out in order to allow their mind to return to a higher level of concentration.  Leisurely surfing activities, in moderation of course, allows workers to be more productive.  All of us need to get away from our desk, walk around, and take a break.  Evidently, our mind needs time to play as well.

“Firms spend millions on software to block their employees from watching videos on YouTube, using social networking sites like Facebook or shopping online under the pretense that it costs millions in lost productivity, however that’s not always the case,” said Dr. Brent Coker, from the University’s Department of Management and Marketing.

According to an article published on Wired.com, the research has turned viral and is spreading across offices worldwide due to employee interest.

If this research proves to be correct (and I have my doubts), it should further motivate leaders to consider becoming more flexible with sites like Facebook and Twitter, restricted web addresses for many corporate employees.

Flexibility with technological usage, telecommuting, and other  workplace productivity issues, need to be revisited in many organizations to encourage a more results-only work environment based on trust and respect.  The technological workplace is changing and a great number of managers need to adapt their leadership skills to promote optimum productivity.  Socializing in moderation, whether it’s in the hallway or the information superhighway, should rule the day.

Maybe all work and no play really does make for a dull employee.

Posted in Company Culture, Leadership / No Comments →

Everything Rises and Falls on Leadership

March 6th, 2009

Leadership

During lunch the other day I was seeking marketing advice from a good friend and respected business leader.  Full of wonderful and relevant ideas, she mentioned my writing style tended to be very direct.  This Tulsa business leader said a couple of articles seemed to reach out and grab the reader in a more threatening tone.  Because I greatly respect her opinion, I wanted to share some thoughts.

First, I apologize if my writing is too aggressive at times. Unfortunately, we work in a business climate today where overly aggressive behavior is rewarded. The “just get the job done” attitude is not the way to build long-term, viable organizations. Short-term thinking and decision-making, along with greedy behavior, will eventually lead to an organization’s failure.

Why So Direct?

It is not my intention to offend people, just help them think about important people issues at work.  Typically, leaders have no problem being excruciatingly direct with employees.  My role is to be direct with business leaders while trying to avoid a harsh tone.  Your job is difficult.  I feel your pain.

When I played tennis I found improvement was gained when playing against better tennis players. Good tennis players don’t go easy on you.  They serve hard and aggressively attack the ball. Reading challenging people practice articles, whether on this blog or other sources, is a good way to bring reality, objectivity, sincerity and best practices into your organization’s people initiatives.  However, I promise to not throw my racket at you or hit you in the head with a tennis ball – on purpose anyway.

My Dream Became a Nightmare

In my last corporate position the company was full of promise and the possibilities, both personally and professionally, were a dream come true.  I have not met many business people who have had the opportunity to help start a company and be part of the team to see it grow into a multi-billion dollar enterprise with national recognition.  It was a dream come true in many respects.

That dream turned into a nightmare for me and thousands of other stakeholders.  As the chief human resources officer, I began to sense there was something terribly wrong with the leaders and was trying to cautiously work behind the scenes to identify the issues and work with the CEO.  Eventually, my efforts to help address the company’s leadership issues failed, but not without great costs to me personally, physically and financially.

Most whistle-blowers end up being harassed, bullied or disciplined. Fifty-percent of whistle-blowers are fired.

The targets of workplace bullies typically suffer from devastating physical affects.

That company is now in the midst of a nasty, disorganized and prolonged bankruptcy.  The SEC, FBI and IRS are all investigating the events leading up to the bankruptcy filing.

My Writing Style

So why do I write the way I do?  It is my hope your company’s employees will avoid the pain and anguish associated with leadership failure.  Business leaders should take seriously their brand of corporate culture.  All organizations should treat employees with dignity and respect and adopt and model positive people practices.

Everything Rises and Falls on Leadership

Great companies can fall, and quickly. Employees do not destroy companies, the top leaders possess this power to build up or tear down an organization.

I was fortunate to escape that smoldering house before it went up in flames.  Actually, I was thrown out a second story window with only the clothes on my back while the owner was secretly dousing the place with gasoline.  The others inside were either unaware or uninterested in my observations about the company’s future.  Sadly, my predictions came true.

My motivation is to help prevent another leadership meltdown. When leaders fail, they bring many innocent people with them.  The risks are too great to sit and be silent.

Will you join me in spreading the message of Positive People Practices?

Posted in Company Culture, Consulting, Leadership / 3 Comments →

Great Workplaces Avoid Layoffs

March 5th, 2009

IN THE NEWS: See Kevin Kennemer, The People Group, appear in this news story covered by Tulsa’s NewsOn6 about a business owner who avoided layoffs.

When meeting with CEO’s, business owners and leaders, it is in their company’s best interest to understand missing employeesthe advantages of adopting, modeling and promoting a Great Workplace Initiative.  The company wins. The employees win.  Our society wins. Great Workplaces are also better able to avoid the scourge of U.S. corporations – the dreaded layoff.

When times get tough, Great Workplaces are better prepared for difficult business conditions.  According to a recent ground-breaking GreatPlaceJobs.com study, Great Workplaces perform layoffs at half the rate of their average-performing counterparts.  This means job applicants should be searching for companies recognized as Great Workplaces. Below are some observations about layoffs:

  • Layoffs should be the last resort, not a knee-jerk reaction to please shareholders.
  • A CEO who knows and cares for employees will first attempt cost-cutting measures and involve the entire workforce.
  • The goal of drastic payroll reduction is to quickly raise the stock price.*
  • Downsizing raises the perceived value of the firm but lowers the actual value.*
  • A leader who has to look employees in the eyes has motivation to pursue alternatives to layoffs.
  • Companies who avoid layoffs are better prepared to meet customer demand when the economy turns around.

Before you call HR and ask them to cut 10% of your workforce, consider these other cost-cutting strategies adapted from our friends at the Great Place to Work Institute:**

  • Involve people to develop strategies. This provides people a sense of control in a difficult situation.  Losing a sense of control in difficult situations can send employees into a tail spin and all their energies will be spent ruminating about the dangers and unknowns ahead rather than the business at hand.
  • Share information. Leaders should not run and hide in the board room.  If the leaders are not out front communicating, employees will create answers to their own questions and this information will spread like wildfire via the company grapevine.  And certainly do not force the employees to read news about their very own company in the media.  Leaders are better off sharing information and often.
  • Show up, be available and say thank you. Get out of the office and walk around the workplace and visit employees. Listening is a great skill, especially during tough times.  Answer the questions you have answers for and obtain answers for those you don’t.  Be sure to say “thank you” to your employees.
  • Start cost cutting with yourself. Leaders should lead by example and that means cutting their own salaries and benefits if that’s what is needed.  Don’t ask employees to do something you are unwilling to do yourself.  Suspend bonus payments for employees and executives.  This will send the message this is a team effort.

What are other alternatives to layoffs?

  • Voluntary retirements.
  • Allow normal attrition to slim down workforce.
  • Reduction in hours for non-exempt employees and pay reductions for exempt employees.
  • Offer unpaid leave. There could be employees who would like some time-off to handle some personal matters, further their education, etc.
  • Offer reduced-salary sabbaticals with benefits.
  • Impose a hiring freeze.
  • Quickly work with under-performing employees. If they do not improve, respectfully part ways. Don’t wait until the economy turns south and disguise the separation as a layoff due to economic reasons because survival anxiety symptoms may surface in the remaining employees.
  • Cancel business travel, especially with the current accessibility of video conferencing.
  • Suspend 401(k) contributions.  But if you do this, make sure the executive retirement plan contributions are suspended too.
  • Finally, rid your company of bullies and jerks.  Bullies impair productivity and raise health care costs and paid time off requests.

Great Workplaces outperform their competition, attract and retain the best talent, enjoy greater cooperation among team members, experience high levels of customer satisfaction and employee innovation, plus a number of other wonderful benefits.  It is never too late to start your Great Workplace Initiative.

* Excerpt from Corporate Violence by Dr. Howard Stein citing Jonathan Lurie 1998.  My thanks to Dr. Howard Stein for his friendship and brilliant mind and writing.

** Adapted from Maintaining Trust in Difficult Times” by Amy Lyman, Co-Founder & Director Corporate Research, Great Place to Work Institute.

Posted in Company Culture, Leadership / No Comments →

What Are You Working For?

February 9th, 2009

As a business owner, I can tell you starting a business is not for the faint of heart. It takes patience, perseverance, determination and a little bit of insanity.  Understandably, there are people who want a stable job where a paycheck arrives every two weeks. My parents worked for their companies a very long time and they never quite understood entrepreneurship. My father worked forty-four years and never used a sick day because he was dedicated to his company.

Thanks to my father’s company where he retired, my mother has the best in health insurance and a retirement plan.  Benefits like that are hard to get in today’s economy.  Unfortunately, that kind of employee-employer loyalty is rare in today’s business environment.

Would I be more comfortable working in a 9 to 5 career with business risks falling on someone else’s shoulders? I can honestly say “no.”  And here are a few reasons why:

People Issues

There is no shortage of people and leadership issues in the workforce. Unfortunately for American workers, most people are unfulfilled, unsatisfied, unrecognized, under-utilized, under-appreciated and unengaged. Why? Leaders typically rank financial issues and a host of other concerns higher in priority than people issues. Address your people issues, on the other hand, and other business concerns will begin to come together.

Mission-Based Living

I’m on a mission to help create Great Workplaces across America.  Employees will enjoy their work life much more if they see a higher meaning attached to it. Most companies say they want employees to enjoy the experience and be passionate about their work, yet that is not the case most of the time.  I am very passionate about treating people with trust, dignity and respect at work. When I confront an untouchable executive about their bully behavior, all of a sudden this passion is considered insubordination.  It doesn’t work to have high moral values and passion about developing a great company culture unless there is true independence as a consultant.

Greed is Alive and Well

Greed destroys lives. Along with many good people, I helped build a nationally recognized company that was destroyed by the uncontrolled greed of a few individuals.  As a result, I learned a very hard lesson: organizational leaders should be held accountable for their behavior.  Leaders should understand how their decisions will affect the hard-working people inside a company. If leaders start veering off a moral path, someone should be able to throw up a red flag.  If their warnings are not heeded, the leader(s) should be shown the exit. Greed has hurt a number of good, innocent people in our country and city recently.  Great Workplaces help to weed out toxic influences like greed. Making money, being profitable, incentive plans, etc., are all extremely necessary. Greed, however, must be kept under lock and key.

Take a few minutes to think about what you are working for in 2009.

Posted in Company Culture, Leadership / 1 Comment →

Profit Sharing Plan Keeps Employees in the Game

February 6th, 2009

“We cannot afford it,” stated the executive in a meeting after our department proposed a profit sharing plan to include all company employees. With the industry’s harsh competitive environment, our expense reduction mandates, along with the absolute requirement to get every employee moving the same direction, I assured the room full of executives we could not afford to pass by the opportunity to place all company employees on the proposed profit sharing plan.

What was the downside, I asked.  The plan only paid if the company hit the established revenue target.  And we needed to hit the target.  For the company to reach its goals, the company couldn’t afford to pay incentives only to management.

Even with the lone executive’s disapproval, there was enough support to obtain profit sharing plan approval.

One Year Later

The results were in after the first twelve months.  The first year was an incredible success as the company exceeded its revenue targets while also cutting costs; truly a winning combination. Employees were finally part of the big picture and were compensated for their contributions.

There are many successful examples this profit sharing process works. Consider the example of Cynthia Bertucci Kaye, CEO of Logical Choice Technologies, Duluth, Georgia. Featured in Fortune Small Business magazine’s February 2009 edition, Kaye shared her painful experience of implementing and then killing a successful profit sharing plan.  She dismantled the plan the second year, wrongly thinking the company couldn’t afford it.

What Happens When You Kill a Profit Sharing Plan?

After writing $770 checks to nearly every employee the first year, the second year Kaye decided to invest profits entirely back into the company. “We posted average revenues of $37 million in 2006, but expenses were unusually high. With no motivation to save money and no email updates on the company’s financial situation, my employees became less careful about controlling costs,” said the CEO. “Losses topped $1 million that year,” according to Kaye.

Why Profit to Loss?

The CEO speculated the reason for the company’s losses was related to employees not feeling plugged into the business like the previous year.  Regular email communications stopped because there was not an incentive payment on the line for everyone. Never underestimate the multiplied power of all employees focused on the same goal. The combined force of employee heads, hands and hearts focused on a winning strategy is amazing.

Profit Sharing Plan Returns

“So in January 2007 I announced the profit sharing program would be reinstated,” said Kaye.  The results? According to Forbes, “It worked like a charm: Everyone found a way to contribute, from the receptionist who took checks to the bank daily – so the funds could start collecting interest as soon as possible – to the in-house travel agent who suggested that a colleague stay at a certain hotel because it was 25% cheaper than the others.”

Revenues hit an all-time high that next year (2007) and employees each received $1,300 incentive checks. Their business future looks brighter now that every employee has a vested interested in the financial performance of the company.

Note: At the time of this post’s publication a link was not available to the Fortune Small Business article, “Reviving Incentive.” When it becomes available, The People Group will provide the link.

Posted in Company Culture, Compensation & Benefits, Leadership / 1 Comment →